Description-: With the infusion of $1.8 billion from James Murdoch and former Star & Disney India head Uday Shankar-backed Bodhi Tree System and an additional $216 million from a Reliance arm, Viacom18 is preparing for an epic faceoff with Disney, Amazon, and Sony Group Corp.
James Murdoch and former Star & Disney India head Uday Shankar-backed Bodhi Tree Systems is set to raise and invest Rs 13,500 crore (roughly $1.8 billion) in Viacom18, a 51:49 joint venture between Reliance Industries-owned TV18 and Paramount Global (formerly known as ViacomCBS). Viacom18 offers 53 channels and reaches around 600 million Indians monthly.
Additionally, under the partnership, Reliance Projects & Property Management Services Ltd (RPPMSL), a wholly-owned subsidiary of Reliance Industries, which has a significant presence in television, OTT, content creation, and production services, will invest Rs 1,645 crore(roughly $216 million) and the popular JioCinema OTT app will be transferred to Viacom18, the companies said in a joint statement.
With the $1.8 billion from Bodhi Tree and an additional $216 million from a Reliance arm, Viacom18 is preparing for an epic faceoff with Disney, Amazon, and Sony Group Corp. for broadcast rights of the Indian Premier League. Bids are likely to exceed $5 billion. Former Star and Disney India Chairman Uday Shankar along with ex-CEO of 21st Century Fox James Murdoch have been roped in as strategic partners so that they can play a vital role in growing Reliance’s media business.
However, Viacom18 has just started building its sports portfolio. It has picked up the media rights of sporting properties including the National Basketball Association (NBA), FIFA World Cup 2022, Italy’s popular football league Serie A, Spanish football league La Liga, ATP Masters (tennis), and Abu Dhabi T10 (cricket), etc.
Viacom18’s streaming arm Voot follows the fremium model that offers free content as well content behind a paywall on Voot Select which is a subscription video on demand (SVOD) platform. Voot Select which was launched in March 2020 managed to get a million subscribers on board in less than a year of its launch.
However, Voot Select has strong competition in the SVOD market where top players like Disney+Hotstar, Amazon Prime Video, and Netflix have around 46 million, 21.8 million, and 5.5 million paid users, according to a report by Media Partners Asia (MPA), an independent provider of research, advisory and consulting services.
Current market leader Star-Disney has a viewership share of 18.6 percent. However, the impending merger of the Sony Pictures Networks India Private Limited (SPNI) along with Zee Entertainment will effectively create a situation where the unified entity will hold a viewership share of 26.7 percent in the Indian market.
After the $2 billion investment by Bodhi Tree system and Reliance arm in Viacom 18; Paramount Global, which owns TV networks and streaming services such as CBS, Paramount Pictures, Nickelodeon, and MTV, will remain a minority shareholder and supply Viacom18 with its global content. ViacomCBS owns 49% of Viacom18. In India, Viacom18 operates TV channels such as Colors, Rishtey, Cineplex, Colors regional bouquet, and OTT platform Voot.
Talking about the $2 billion investment, Mukesh Ambani, Chairman & Managing Director of Reliance Industries Limited, said, “James and Uday’s track record is unmatched. For over two decades, they have played an undeniable role in shaping the media ecosystem in India, Asia, and around the world. We are very excited to partner with Bodhi Tree and lead India’s transition to a streaming-first media market. We are committed to bringing the best media and entertainment services for Indian customers through this partnership.”
While Murdoch and Shankar jointly said, “Our ambition is to leverage technology advances, particularly in mobile, to provide meaningful solutions to meet everyday media and entertainment needs at scale. We seek to reshape the entertainment experience across more than 1 billion screens.”